Below are the Nasdaq 100 companies that are within 5% of their respective 52-week lows. The complete list of 19 Nasdaq 100 stocks within 5% of the low can be found here.
Stocks that appear on our watch lists are not recommendations to buy. Instead, they are the starting point for doing your research and determining the best company to buy. Ideally, a stock that is purchased from this list is done after a considerable decline in the price and rigorous due diligence.
|Symbol||Name||Price||P/E||Div/Shr||Yield||P/B||% from low|
|NIHD||NII Holdings, Inc.||29.73||12.08||0||0||1.36||2.02%|
Watch List Summary
The following are companies we are tracking from our watch list this week. First up is Illumina (ILMN) which was last on our watch list on December 19, 2009. After being on our list, Illumina rose 172% at its peak on July 4, 2011. Already ILMN has lost -45.17% since the high in July. While ILMN is still nearly 50% above the December 19, 2009, price, the possibility exists that all the gains that were made could disappear in short order. As an example, anyone who bought ILMN after June 4, 2010, is confronted with a loss. ILMN has a market cap of $5.18B. Levered free cash flow at $146.48 million and enterprise value at $4.75 billion. The stock has lost -47.52% since the high on July 6th and is currently trading at 4.65% above its 52-week low.
Paychex (PAYX) was on our new low watch list on August 15, 2010, when it was within 2% of the 52-week low. Subsequently, Paychex rose 35.80% in seven months. Employment being what it is, PAYX is trading in a wide range, exhibiting a strong base at around $25. According to Value Line, PAYX is trading 30% below the historical fair value. PAYX has no debt and is likely to be an acquisition target if the stock remains at the current price or lower. Already PAYX has fallen 22% from the high set on March 9th bringing the market cap down to $9.49 billion. Prior to 2008, PAYX had a 19-year history of increasing the dividend. Since 2008, the annual dividend has remained at $1.24. PAYX would be purchased at any price below $25.50.
Netflix (NFLX) is going through significant turmoil as reflected in the stock price. Since the high of $298.73, NFLX has plummeted to $129.36 or down -56%. The financials on NFLX are a moving target, making it difficult to fully determine the company’s true value. However, the business model is compelling and warrants considerable review. NFLX has a market cap of $6.8 billion and enterprise value of $6.65 billion. After applying Edson Gould’s 1/3 speed resistance line, NFLX will become worth considering at $99.58 and below. A detailed analysis of Gould's speed resistance line applied to NFLX can be found here.
Expeditors International of Washington (EXPD) has fallen to within 2.98% of the 52-week low. According to Yahoo Finance, EXPD provides logistics services which involves consolidation or forwarding air and ocean freight. EXPD is a highly efficient organization and is trading at 2006 prices as if the company hasn’t averaged earnings of $1.32 in last four years compared to average earnings of $0.66 in the period from 2002 to 2005. According to Value Line Investment Survey, EXPD is estimated to have cash flow of $2 for 2011. Historically, EXPD has traded at 25 times cash flow which suggests that the stock should be selling at a fair value of $50. EXPD has increased their dividend every year for the last 18 years.
Watch List Performance Review
The performance of our watch list after one year is to remind us of the possible outcome of investing in the stocks on our list. It is hoped that we can gain greater insight in the investing process and refine that process as we go along. Below is the performance of the top five stocks on our Nasdaq 100 watch list from September 17, 2010.
|AMAT||Applied Materials, Inc.||11.02||10.59||-3.90%|
|MXIM||Maxim Integrated Products||16.91||23.89||41.28%|
|NDX||Nasdaq 100 Index||1955.83||2206.86||12.83%|
Click to enlarge
All of the top five stocks from last year achieved 25% returns by May 2011. However, only Maxim Integrated was able to sustain its price performance that was above the Nasdaq 100 throughout the year. As a group, the top five fell short of the Nasdaq 100 by -0.40%.
Disclosure: I am long EXPD. Also long AMAT.